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What is the meaning of the term retained earnings? Where do retained earnings show up in the financial statements? What makes retained earnings go up or down? In this video we walk through the definition of retained earnings, analyze two real-life examples of well-known companies to understand how retained earnings get accounted for, and provide bonus tips above and beyond what other videos and textbooks would give you on things you should know about retained earnings. To retain means to keep, and earnings means profit. Retained earnings is commonly defined as that part of a companyamp;#39;s cumulative historical profits that has not been distributed to shareholders through a dividend. Retained earnings are one of the items that connect the income statement and the balance sheet. The income statement, or profit and loss statement, is like a movie about profitability during a period (usually a month, a quarter or a year). The balance sheet, or statement of financial position, is like a
